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The US Market for Water Technologies

The World’s Largest Market for Water Technologies

The US is the world’s largest market for water-related technologies. According to the US Environmental Protection Agency (EPA), with roughly 152,000 public water systems serving nearly 320 million Americans (roughly 2,000 individuals per utility on average), the US water distribution system is highly fragmented.

In addition, the US is currently facing major water challenges including increasing water scarcity, aging infrastructure, the lack of funding for maintenance and repair, the renewal of the water infrastructure, as well as climate change issues.

The EPA estimates USD 271 billion over the next 25 years for the restoration of the US water infrastructure to carry out repairs of wastewater and rainwater systems. The American Water Works Association and the American Society of Civil Engineers calculate that the total costs for the repair and maintenance of these water systems will require at least USD 1 trillion.

These challenges, combined with stricter environmental policies, an increasing awareness of the value of water resources amongst the US population, and the demand for financing structures in the water sector (public private partnerships), have created large market opportunities for foreign investors and equipment suppliers. Automation technology to bypass the reducing and aging workforce are in particular demand.

Important Market Statistics, Trends and Developments

Per capita, the US water consumption is three times higher than the German water consumption; at the same time, the rates for water in the US are less than half the rates of those in Germany.

Industry water is amongst the fastest growing sectors of the global water market. The market for industrial water treatment technologies is set to expand by more than 50% over the next five years, from around USD 7 billion in 2015 to more than USD 11 billion in 2020.

Due to growing number of water shortages in populous states such as California, there is a rapid growth in investments into wastewater treatment as well as reuse and reclamation technology. According to Bluefield Research, capital expenditures of US municipal water and wastewater utilities are expected to exceed USD 532 billion between 2016 and 2025.

Market Opportunities for German Companies

Germany is a recognized leader in the field of water sustainability as well as in corresponding efficient and environmentally-friendly water technologies. Especially in the Midwest, around the Great Lakes (accounting for 84% of the existing North American drinking water resources), are promising opportunities for German companies in terms of future projects and investments.

Most water infrastructure systems in the US (e.g. sewage systems, drinking water treatment, sewage treatment plants, storm water systems) were constructed more than 50 years ago and are in need of an upgrade. In 2017, the water industry is at a critical inflection point due to the growing acknowledgement of the aging infrastructure and the Flint, Michigan crisis, which raised public awareness of water quality issues to new heights.

In the region around the Great Lakes, there is a high density of industries with high water consumption and sewage volume (e.g. food & beverages, pulp & paper, manufacturing or agriculture). These industries are facing the challenge of stricter wastewater treatment and recycling regulations and are increasingly investing in sustainable and efficient water technologies.